There is growing recognition that early school achievement, especially in literacy are the product of a) prior language skills and experiences before formal schooling;b) the nature and quality of the contemporaneous classroom instruction in the early grades;c) parenting experiences in the home, and d) outside school activities. Despite acknowledgement that early skill in literacy rests on this combination of assets and resources, no previous studies have prospectively examined these issues for children in non-urban lowincome communities, even though children from these communities have among the worst academic outcomes. Careful examination of the proximal processes in the home, school, classroom, and out of school contexts will be examined as they contribute to literacy skills in the first three years of school. The goal of the proposed study is to predict the acquisition of literacy skills from both distal variables (poverty, ethnicity and rurality) and proximal processes within the child, family, classroom, and out of school experiences from birth through 2nd grade in our representative sample of 1292 children in two poor rural areas of the US. The first phase of the project has charted the children's early language development and language interactions at home and childcare. In the next phase of the study, children's emergent literacy skills will be of particular importance because of their role as "gateway" skills for later learning. Failing to acquire literacy skills early is highly predictive of failure in multiple academic domains in the later school years. The classroom experiences are viewed as especially important for many of our struggling learners, and wilfbe characterized in terms of the emotional and instructional support, management style, and match between type of instruction and the child's skills. The home literacy environment, including parent bookreading and talk about school will also be examined. Both the home and school proximal processes are thought to be the major mediators between poverty, ethnicity, and rurality in understanding children's literacy development. The kinds of out of school activities will be examined to determine whether they deflect trajectories. Special importance will be placed on the characteristics of classrooms that close the gap between African American and non-African American and low and middle SES children in non-urban classrooms. Such information is needed because the dynamics of these families, schools, and communities are substantially different, and unless taken into account, programs to address the literacy achievement in low-income rural communities may be ineffective. These results can provide the type of information needed to develop programs (e.g., family and school programs, teacher training, and instruction) for these rural children, families, and schools.